About Me

  • I'm CEO of Newspeg.com, a social news-sharing platform. I've spent 20 years at the intersection of traditional and digital journalism. I've helped to invent ways to read and interact with the news and advertising on computer screens and iPads, and before that, I wrote news stories on typewriters and six-ply paper. I co-founded WashingtonPost.com and hyperlocal pioneers Backfence.com and GrowthSpur; served as editor of Philly.com; taught media entrepreneurship at the University of Maryland; and have done product-development and strategy consulting for all sorts of media and Internet companies. You can read more about me here.

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March 04, 2009

Comments

Tim Windsor

Mark,

I think you're right that we need to focus on finding better ways to build advertising solutions in our local markets. There are many more dollars available on that path than there are trying to squeeze payments for content out of site visitors.

I took a look at one interesting approach to advertising this morning on the Nieman Journalism Lab. It's long-form advertising that's essentially high-quality content that happens to be an ad in the bargain. I make the argument that thinking about advertising in such new ways -- getting outside of the banner and the text ad -- is key to growing ad dollars for local news operations.

More here: http://is.gd/lKXF

tgdavidson

Incisive, Mark. Let's run another set of numbers, shall we?

Let's deconstruct the myth of the newspaper-specific e-reader, ala Hearst. We'll assume it works; we'll assume it can (unlike the Kindle) provide color; we'll assume the form-factor issues get worked out (ever try to read one of those crappy e-editions on a laptop? Ooops! Horizontal screen, vertical layout!).

We're gonna beta-test our new toy at the SF Chron, daily circulation 375,000.

Because we're brilliant at assuming things, we're gonna say we're better - or at least more benevolent - than Amazon. No $359 price tag on this puppy, like the Kindle. Razors and razor blades and all that - we're going to sell the device to our loyal readers at cost.

Even if that cost were $100 per device (a really difficult price point to hit, by the way), do we expect a reasonable portion of our readers to shell out $100 for the device and pay us a subscription fee?

Ooops.

Oh-KAY, then. We'll follow the cable TV model with those fancy digital set-top boxes and DVRs. We'll rent people the device for a couple bucks a month. All we need to do is buy the devices first.

375,000 devices times $100 is ... $37.5 million.

Let's see: We have a newspaper that's losing $1 million to $2 million per week - and our plan to save it is going to require an up-front investment of another $37 million? With more ever year for the inevitable upgrades, replacements for lost/damaged/stolen units?

Tough thing, that math.

mnmears

Again, this advertising problem is another of several reasons that I think the most workable model for today and the immediate future is for electronic publication utilizing the existing design, layout and style of the printed publication.

The e-edition is a hybrid, but I think it's one that well serves both readers and advertisers. It doesn't require a special reader ... most any descent computer or laptop with Internet access will do. Utilizing hotlinks and such, it can offer a depth of coverage unavailable to printed publications.

As a local merchant, do you enjoy paying extra money for full or spot color that could be FREE with an e-edition? Would you rather have a banner ad or that quarter-page or half-page ad with a hotlink that takes people to your e-commerce site or a spot for a print-on-demand coupon?

Newspapers can charge advertisers based on page views as well as charge a small additional fee for click-throughs. Amazon.com offers a small stipend for some Web sites and bloggers if viewers use a link from those sites to purchase books, DVDS and other merchadise from Amazon.com. Why couldn't newspapers collect a teeny-tiny bit if a consumer buys from an advertiser's site because of that hotlink?

National advertising inserts could and should be put up as part of the publication's e-edition -- again with a fee based on circulation with a bonus for click-throughs to the retailer's site and a small .01 to .05 percent fee for online sales generated from that link and visit.

This might actually be a win/win for everyone involved. Think of the savings for advertisers with a 50 percent reduction of print publication (newsprint, press time, shipping, fuel, labor) ...

Newspapers should realize if they don't push this new technology, the retailers will eventually do a cost/benefit analysis and simply realize they're not getting enough bang for the buck distributing inserts in newspapers.

If local display and national advertising insert revenue dries up, even a complete Web-based e-edition will have a tough time making it without going to a nonprofit, NPR/PBS-type model.

Bob

Thanks for the great analysis, Mark.

As for the Wall Street Journal, I'd be suspect about its claims for paid online subscriptions. For instance, I know someone laid off from a financial services company three years ago when a division when kaput. She still can access the WSJ through that account even though no one's been paying for it for at least three years.

My guess is that it's more valuable for the Journal to claim it has that many subscribers than for the paper to audit the accounts and have to admit only a fraction of them are paying.

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